Hong Kong’s financial markets watchdog has issued a warning over the risks of online platforms for cryptocurrency and other digital asset deposits. “Investors are urged to be wary of the potential high risks” associated with so-called “virtual asset arrangements,” the Securities and Futures Commission (SFC) said in a statement. The announcement comes at a tumultuous time for the cryptocurrency market. This week the founder of failed crypto exchange FTX was arrested and charged. “Whilst some VA [virtual asset] Arrangements are commonly labelled or marketed as ‘deposits’ or ‘savings’ products, they are not regulated and are not the same as bank deposits. Investors are not afforded with any form of protection,” the SFC said. “If they cannot fully understand them and bear the potential significant or total losses, they should not make an investment,” it added. It came after Sam Bankman-Fried, founder of the failed cryptocurrency exchange FTX, was arrested in The Bahamas on Monday. Within hours US authorities charged him with “one of the biggest financial frauds in US history”. The former FTX chief executive built a “house of cards on a foundation of deception,” Security and Exchange Commission (SEC) Chair Gary Gensler said. Later on Tuesday Mr Bankman-Fried was denied bail by a judge in the Bahamas.
Full story : Hong Kong markets watchdog warns of cryptocurrency platform risk.